DEFINITION of 'General Public Distribution'

A type of primary market offering in which the securities being issued are available to anyone who has the ability to purchase them. This differs from conventional public distributions of securities in which underwriting investment banks sell large blocks of the issued securities to large investors.

BREAKING DOWN 'General Public Distribution'

If you take part in a general public distribution of securities, you are participating in what is called the primary market: you are buying securities directly from the issuing company, and your funds go to it to finance its business activities. This is in contrast to the secondary market, where investors buy and sell securities from each other, with funds moving back and forth from investor to investor without involving the underlying company at all.

RELATED TERMS
  1. Offering Price

    The price at which publicly issued securities are made available ...
  2. Underwriting Group

    A temporary association of investment bankers who wish to purchase ...
  3. Primary Distribution

    The original sale of a new security issue (bonds or stocks) from ...
  4. Exchange Distribution

    A type of trade made on the floor of a securities exchange in ...
  5. Security

    A security is a fungible, negotiable financial instrument that ...
  6. Underwriting Agreement

    A contract between a group of investment bankers who form an ...
Related Articles
  1. Investing

    What's the Primary Market?

    The primary markets are where investors can get first crack at a new security issuance.
  2. Insurance

    Brokerage Functions: Underwriting And Agency Roles

    Learning about these various activities can give insight into how securities are issued and traded.
  3. Investing

    Comparing Primary And Secondary Capital Markets

    In the primary capital market, investors buy directly from the issuing company. In the secondary market, investors trade securities among themselves.
  4. Investing

    The Road To Creating An IPO

    Through an Initial Public Offering, or IPO, a company raises capital by issuing shares of stock, or equity in a public market. Generally, this refers to when a company issues stock for the first ...
  5. Insurance

    What Does an Underwriter Do?

    In the investment world, an underwriter is a company that helps corporations or other issuing bodies distribute their securities.
  6. Investing

    A Look At Primary And Secondary Markets

    Knowing how the primary and secondary markets work is key to understanding how stocks trade.
  7. Investing

    What is Market Value?

    Market value is the price of an asset that is traded or offered for sale in a public forum where multiple buyers are allowed to make offers to buy that asset.
  8. Small Business

    Uncovering The Securities Firm

    Learn about the various departments of a securities firm and the professionals who make it work.
  9. Investing

    What's a Marketable Security?

    Marketable securities are financial instruments that can be readily bought and sold in a public market. The key feature is the ease with which it can be sold and converted into cash. Usually, ...
RELATED FAQS
  1. What securities does the primary market deal with?

    Find out what kinds of securities are traded on the primary market, including who can participate in trading and the basics ... Read Answer >>
  2. What is the difference between a primary and secondary financial market?

    Learn about primary and secondary financial markets, how investors use these markets and the difference between primary and ... Read Answer >>
  3. When you buy a stock in a company, does it necessarily mean that one of the shareholders ...

    There are two main markets where securities are transacted: primary and secondary. When stocks are first issued and sold ... Read Answer >>
  4. Who facilitates buying and selling on the primary market?

    Learn more about the primary marketplace -- home of initial public offerings -- and the major players that make buying and ... Read Answer >>
  5. What is the difference between an IPO and a seasoned issue?

    Learn how companies issue IPO securities when they first go public and seasoned issue shares if they sell more shares in ... Read Answer >>
  6. Do underwriters make guarantees to sell an entire IPO issue?

    Underwriters represent the group of representatives from an investment bank whose main responsibility is to complete the ... Read Answer >>
Trading Center